California does Medicaid home care well. They’re being punished for it.

On July 21, HHS Secretary Robert F. Kennedy Jr. and Dr. Mehmet Oz, who heads Medicaid programs federally, announced they’re deferring over $850 million from the state of California over its Medicaid-funded home and community-based services program called In-Home Supportive Services (IHSS). The Trump administration has attacked IHSS for the program’s growth over the past decade.

Their argument: the program is so successful there must be rampant fraud.

Home and community-based services got started under President Ronald Regean to help disabled people remain in their communities with the assistance of paid aides, including family members, instead of being institutionalized. From a purely economic standpoint, home and community-based services care is cheaper than care in hospitals or nursing homes. And disabled people find the right to remain in their communities to be so crucial that it has become an essential tenet of disability rights activism.

Hagar Dickman, who directs California-focused long-term services and support at Justice in Aging, told me that disabled people “are entitled to the life that we expect to have of independence, of autonomy, of self-actualization, and agency.”

As of May 2026, nearly a million disabled and aging Californians are authorized for home and community-based services through IHSS. Unlike in some states, like Texas, where people can lag on waiting lists for over a decade, once a disabled Californian goes through the process of qualifying for IHSS, they are able to get services to help them live independently immediately.

The program’s growth, according to Tyler Sadwith, who directs Medicaid services in the state, is proof that it’s working. In February, Sadwith wrote a letter to Dr. Oz’s agency defending it against allegations of fraud. “Outcomes that CMS has repeatedly endorsed and promoted through federal approvals of California’s IHSS and [home and community-based services] programs, because they deliver care at a fraction of institutional costs.”

Experts I spoke with are concerned that the attacks specifically on California could be used to make an example of paid caregiving, which Kennedy has attacked profusely. Attacks on paid caregiving are also happening at the same time that the Department of Justice is trying to undermine Olmstead, a Supreme Court decision which granted disabled people the right to remain in their communities, in addition to brutal federal Medicaid cuts.

“One of the incredible things about paid family caregiving models is that it allows people to have culturally competent care,” Sabrina Epstein, Disability Rights California policy analyst, told me. “The program is set up for people with needs above and beyond the usual care that a family member would provide, and so these claims of fraud are ableist and racist.”

And unlike attacks towards Minnesota and Medicare-funded home health in Los Angeles, there isn’t even a “few bad apples” argument to be made when attacking IHSS. California, like every state, also investigates Medicaid fraud.

“There’s an existing framework to ensure that there’s not fraud. You can’t bill for more hours than you’re allotted,” Elizabeth Zirker, a senior attorney with National Health Law Program, told me. Additionally, Zirker notes, in California, Medicaid home care is not administered through private companies, unlike some other states.

Additionally, getting IHSS is not automatic for disabled Californians on Medicaid who apply. “It’s not as simple as applying for in-home supportive services and then being awarded hours,” Zirker said. “Counties are not incentivized to pay for services people don’t need.”

And California’s model is still not perfect; experts I spoke with cited waiting lists for some smaller Medicaid-funded programs outside of IHSS, people needing more hours than they are given and pay for care workers needing to be higher.

“The whole assumption that you know growth means fraud is absurd,” Dickman said, “especially given all of the investments that the state has made to actually intentionally grow the program in order to benefit its disabled population and to support people living at home.”